Author: Krutika Patil, REVA University.
To the Point
The Karnataka High Court Ola announced the decision to put a blanket ban on bike services. Ola, Uber, Rapido stopped their operations in the state on Monday. Rapido sent a message to its users through the app saying, “Starting June 16, 2025, our Bike Taxi services in Karnataka will be paused in compliance with recent High Court orders. While we deeply believe in the value bike taxis bring to daily commuters, we respect the law and will fully abide by the directive.” The court stated that the service provided by the two -wheelers who are unregistered for commercial use is an illegal activity and halted all such platforms from providing such service. This decision ignited several discussions online on whether it was the right thing to do. Not to mention, the sudden ban has affected the business of the companies like Rapido, Uber, and Ola.
Abstract
Ropeen Transportation Services Pvt Ltd vs State Of Karnataka , filed by the parent company of Rapido , along with other taxi aggregators such as Uber and Ola , when heard by Justice B Shyam Prasad stated that the company cannot seek to ask the state to change the regulations or mandate registration of non-commercial vehicles. The ban has impacted thousands of gig workers, and the customers who benefitted from the affordable bike taxi service. Rapido has reported that more than 75 percent of bike taxi operators rely on the platform as their primary means of income, generating an average monthly revenue of Rs 35,000. Additionally, the company noted that two-wheeler contract carriage has been legally recognized since the introduction of the Motor Vehicle Act in 1988, with a corresponding advisory from the Centre reaffirming this legal stance. The need to further introspect and reflect upon the regulatory norms for bike taxi service.
Use of Legal Jargon
The decision of the bench relied on the interpretation of the Motor Vehicle Act,1988.Sections 2(7),2(47),92,93 were up for interpretation. These provision regulate the means of transport for commercial purposes. They include contract carriage and registration of the taxi services. The general norm under the MVA is that the registration of two wheeler vehicles are for private use, but the taxi bikes operate outside this definition. Section 93 lacks a specific state rules creating lacuna for procedural clarity. The counsel for the Rapido company has argued that the ban is violation of Article 14 and Article 19(1)(g) of the constitution.
One must also observe the absence of laws on conduct for bike taxis, the liability in case of damage and the apparent failure of protection of gig workers under the law. The judgement given by the Hon’ble High Court is said to be violation the principle of proportionality.
The Proof
Traffic in Bengaluru increased by approximately 18%, according to a report, as commuters lost a quick and cost-effective alternative. The Auto fares rose by around 25%, leading MP PC Mohan to call for a minimum fare cap of ₹35 for app-based auto services. Aggregators temporarily initiated bike-parcel services, transporting “parcels” that were, in fact, passengers — however, this workaround was quickly terminated.
Supporters such as NASSCOM and opposition MLA Arvind Bellad contend that the ban adversely affects economically disadvantaged gig workers and students. The challenge in regulating bike taxis is not bound to the state of Karnataka. The states in India are dealing with the same issue. The Hon’ble Supreme Court in a case identical to this stated that “Solely on consideration of balance of convenience, such interim stay on a public notice ought not to have been granted.” The Court consequently ordered a permanent suspension of the enforcement of the contested High Court orders. The Court stated, “We are confident that upon the establishment of the Policy, every application for a license or permit concerning two-wheelers to be operated under the aggregator system will be processed promptly and within a specified timeframe.” The court stated that the states must prescribe conditions for obtaining license to identify bike taxi services as legal.
Case Laws
Uber India Systems (P) Ltd. v. Union of India & Ors. 2023 SCC Online SC 901
Uber India Systems (P) Ltd. v. Union of India & Ors. (2023)
The Supreme Court, through a vacation bench of Justices Bose and Bindal, stayed the Delhi High Court’s interim order that had permitted Uber Moto, Rapido, and Ola Bike to operate bike-taxis in Delhi. The court held that two-wheelers cannot ply as contract carriages without proper state-issued aggregator licenses under the Motor Vehicles Act, 1988. It directed the Delhi government to finalize and notify its Motor Vehicle Aggregator policy by 31 July 2023.
Roppen Transportation Services (P) Ltd. v. Union of India & Ors. (2023)
The SC affirmed that aggregators must obtain a license under Section 93, and while Central “Aggregator Guidelines 2020” are persuasive, only States may formally regulate via Section 96 rule-making. The judgment reinforced that bike-taxis cannot operate without state policy or statutory rules
Conclusion
The decision by the court seems to follow the lines of rules and regulation. The real concern must be on the protection of gig workers who provide this service. The supreme court has recognised the need to accommodate the two wheelers in the commercial space. The government must without a doubt , act in favour of the changing purpose rather than go against it. The need to regulate the conduct must be incorporated in the current legal status. The lacuna around administration, conduct , procedure must be made more clear and defined. This ban must for the better for the socio-economic reasons be followed by modification to section 93 of the Motor Vehicle Act,1988.
FAQS
Why did Karnataka ban bike-taxis?
The HC held that bike-taxis operate as “contract carriage” under Section 92 MVA and cannot function legally without State-issued permits & regulations.
What alternatives does the state propose?
Only traditional public transport—buses, autos, and cabs. Aggregators pivoted to parcel services, but riders demand a formal two-wheeler taxi scheme.
Have other states regulated bike-taxis?
Yes . Cities like Maharashtra, Delhi, West Bengal, and others have permitted bike taxi services under licensing regimes (GPS, permits, safety helmets, etc.)
What is Section 2(7) of the Motor Vehicles Act?
Section 2(7) defines a “contract carriage” as a vehicle that is hired for carrying passengers for hire or reward under a contract, for the whole journey. Bike-taxis fall under this definition if they carry passengers in exchange for payment, making them subject to commercial regulations.
What is Section 2(47) of the Motor Vehicles Act?
Section 2(47) defines a “transport vehicle”, which includes both goods and passenger vehicles. Two-wheelers used for personal purposes are not transport vehicles. However, when used commercially (as in bike-taxis), they require reclassification and appropriate permits.
What does Section 92 of the MVA say?
Section 92 mandates that contract carriages must be authorized by the State Government. Bike-taxis operating without such authorization are considered illegal under this provision.
What is the significance of Section 93 in the bike-taxi debate?
Section 93 empowers State Governments to make rules for licensing aggregators, such as Uber, Ola, and Rapido. Without these rules, aggregator operations involving bike-taxis cannot be legally regulated or permitted.
What are the penalties under Section 192A of the MVA?
Section 192A prescribes fines up to ₹10,000 and/or imprisonment for using a vehicle without a valid permit. Authorities often invoke this against illegal bike-taxi services.
REFERENCES
https://indianexpress.com/article/cities/bangalore/rapido-bike-taxi-operations-karnataka-hc-order-10069511/
https://www.scconline.com/blog/post/2023/06/12/bike-taxi-ban-supreme-court-reinstates-ban-on-uber-bike-rapido-in-delhi/
https://www.thelawadvice.com/news/karnataka-hc-orders-rapido-bike-taxis-to-halt-operations-in-6-weeks
https://www.oneindia.com/bengaluru/rapido-uber-moto-ola-bike-barred-as-karnataka-enforces-statewide-ban-4182177.html
https://www.scconline.com/blog/post/2023/04/18/delhi-high-court-dismisses-pleas-challenging-notiifcations-issued-by-union-of-india-imposing-gst-on-uber-ola-rides-in-auto-rickshaws-and-buses-legal-updates-research-awareness-news-law/
